alleryStart learning →Managers may repurchase shares to signal that the stock is
ATrading below intrinsic value
BTrading above intrinsic value
CNewly listed on an index
DFairly priced at all times
Answer & Solution
Correct answer: A. Trading below intrinsic value
A manager who thinks the stock trades below intrinsic value may buy it back and benefit when price recovers.
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Related questions
Under Section 68, specified securities includeAfter a buy-back, a remaining investor's proportionate ownershipThe details of the transfer to capital redemption reserve are to be disclosed in the40,000 shares of face value Rs 5 are bought back at Rs 9. Equity share capital is debited Which can absorb the premium paid on a buy-back?Shares that a company has bought back areWithin six months after a buy-back, a company may still make aThe register of bought back shares is kept at the company's